Big plans for Manitoba rail line

A group of farmers from Rathwell,
Man., Canada, and the surrounding area are hoping to purchase a shortline
railway to keep their grain shipments on track, the Central Plains Herald
Leader reports. Harold Purkess, a retired farmer from Holland, who is interim
president of River Hills Railroad Inc., said the organization is made up of a
group of farmers and interested individuals who are investing in the project
and preserving their rail line.

He said he heard from
Carman MLA Blaine Pedersen that Canadian Pacific Railway might be discontinuing
its 100-kilometre (62-mile) rail line between Rathwell and Nesbitt, which runs
parallel to Highway 2. The farmers decided they would rather purchase it than
let it fall into disuse.

"Originally, it
started early last August," said Purkess. "It was brought to our
attention by our local MLA that a rail line was going to be put up for
abandonment. Our local MAFRI (Manitoba Agriculture, Food and Rural Initiatives)
rep Bob Wheeler, from the agriculture office in Treherne, and Blaine Pedersen,
our MLA, organized a meeting in Holland in early August to bring us all up to
date at a public meeting ....

"Then, (Darin)
Bouchard, (a farmer) from Cypress River, and myself decided we would come
forward and start to get a committee together to see if we couldn't buy this
chunk of line and turn it into a shortline railroad. Both of us, we have taken
the interest, because we feel it is an incredibly valuable asset to our
community to have this rail line stay here."

He said each farmer that
ships a carload of grain on the line could save a minimum C$1,000, rather than
paying the charges to transport their grain through the local elevator. The
group of 90 shareholders plans to use the shortline rail mainly for their grain
shipments, but may also be able to use it for other commodities depending on
what business opportunities arise. Purkess said there might also be a future
use for sending canola if a bio-diesel plant opens.

They have invested
roughly $300,000 in total for the project so far, with part of that going to
complete a feasibility study on the project in October 2009 that showed the
project looked to be a favorable investment. The farmers plan to make an offer
for a down payment to purchase the short-line rail from CP Rail.

"We hope to have
something (an offer) in place to give to CP Rail by mid-January," said
Purkess.

CP Rail spokesman Kevin
Hrysak said rail lines are assessed over a three-year period to determine
whether they are still viable for the company to operate or should be
abandoned, at which point CP will offer a section of track for sale, under the
federal government's Canadian Transportation Act.

"There are no plans
to abandon it at the moment or put the line up for sale," he said of the
Rathwell track on Jan. 12. "It is an expression of interest from this
group who made a play for that piece of track approached CP."

Hrysak said he was not
able to give any details of the negotiation between the two parties as it is
confidential.

"It is kind of
outside the process, but we are entertaining the offer," he said. "I
know that we are negotiating with them, but nothing has been decided on that
now."

Hrysak said normally at
this stage, CP would only sell the line for continuation of rail operations. He
noted there does not appear to be any growth between Rathwell and Nesbitt, and
instead CP is able to offer the rail service from Nesbitt to Souris and from
Rathwell to Winnipeg.

"Because Nesbitt and
Rathwell are between two high-producing elevators and we have access
points," explained Hrysak. "A lot of stuff is either going east or
west out of each of those locations and nothing in between the two. That was
the reason for putting it on the three-year plan (for discontinuance)."

Hrysak said when a
short-line rail is put up for sale, both the land and track is offered up for
purchase.

"It will be up to the
purchaser to maintain and operate, as well," said Hrysak.